Tax on db x-tracker ETFs

Californication

Hi

Does anyone know how the tax works on DB x-tracker etfs? They have distributing status, so income is taxed as income and capital gain as capital gain. However, they track a total return index using a swap, so presumably no cash is ever produced, just capital gain on the swap. So is all the gain (even reinvested dividends in the index) capital gain?

Please don't guess; I can guess. I'd really be interested in someone who knows and ideally a link to a source

Thanks
--C

Joey122

Californication wrote: »

Hi

Does anyone know how the tax works on DB x-tracker etfs? They have distributing status, so income is taxed as income and capital gain as capital gain. However, they track a total return index using a swap, so presumably no cash is ever produced, just capital gain on the swap. So is all the gain (even reinvested dividends in the index) capital gain?

Please don't guess; I can guess. I'd really be interested in someone who knows and ideally a link to a source

Thanks
--C

Did you actually find the answer to this by any chance?

turbobob

You should read this document which covers how swap based ETF's work - http://www.dbxtrackers.co.uk/EN/binaer_view.asp?BinaerNr=254

This document states that any gains made on the disposal of shares in the listed funds are treated as a capital gain for tax purposes. http://www.dbxtrackers.co.uk/EN/binaer_view.asp?BinaerNr=295

sabretoothtigger

Yep capital gain. Its not unique, unit trusts accumulate dividends also alot of the time